Assignment -1

Submission Deadline: 17 Aug 2021 by EOD

1) Speaker Kits. Inc., packages high fidelity components for mail order. Components for the top-of-
the-line speaker kit, “Awesome” (A), includes 2 Bs and 3 Cs. Each B consists of 2 Ds and 2 Es.
Each of the Cs has 2 Fs and 2 Es. Each F includes 2 Ds and 1 G. It is an awesome sound system. As
we can see, the demand for B, C, D, E, F and G is completely dependent on the master
production schedule for A-the awesome speaker kits. Table 1. Provides the lead time information
for Awesome speaker kits.

Table 1. Lead Times and On-hand inventory

Component Lead Time On-hand

s inventory
A 1 week 10
B 2 weeks 15
C 1 week 20
D 1 week 10
E 2 weeks 10
F 3 weeks 5
G 2 weeks 0

From the preceding information, construct a product structure tree and the gross materials
requirement plan with a production schedule that will satisfy the demand of 50 units of A by
week 8 using lot sizing with Lot-for-Lot.

2) Consider the information given for component C of Speaker, kits, Inc. in table 2 to answer
the following questions.
a) If the ordering cost is Rs. 100 and holding cost is Rs. 1 per period, Calculate the total cost
b) Estimate the total cost using EOQ (Hint: Calculate the average demand from table 2,
then obtain annual average demand =52 weeks * weekly avg demand to calculate EOQ)
c) Calculate total cost using POQ (Hint: POQ interval =EOQ/ Avg. weekly demand)

Table 2. Demand data

WEEK 1 2 3 4 5 6 7 8 9 10
Gross Requirement 35 30 40 0 10 40 30 0 30 55
PAB (35)
Net Requirement
Planned Order
receipts
Planned Order
Release
(Marks 10)